The Growth We Deserve

The Indian Express 31st December 2020 Save

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Context: Actions are required to avoid a stunted recovery

Present state of the economy: Hugely divergent performance

Sectors showing growth prospects: Pharmaceuticals and chemicals, Fast-moving consumer goods (FMCG), Automobile sector (Two-wheelers sales), Construction equipment, capital goods.
Sectors which are still a concern: Travel and tourism, real estate and construction, retail and salaried employment.

Way forward: For a solid, sustained and deep recovery

Set out clear growth ambition: g. Aspire for a growth of 9 % for three years, which will get us back to our 5 % trend line of growth by 2024.
Government should pay its bills: Distribute the pending tax refunds, pay the bills of all companies, pay off the arbitration awards pending and pay state governments their Goods and Services Tax dues.
Invest in public health infrastructure: To spread confidence instead of despondency.
- Central Government should finance states’ efforts to build an extensive public health network for handling the possible second wave of the virus.
- Government should work in partnership with private sector hospitals instead of issuing diktats.
Massive investment in Infrastructure: including roads, ports and logistics.
- Put in place the right public-private programme to provide decent, accessible housing, with quick and cheap connectivity to cities.
- This could trigger a building boom that would stimulate demand.
Huge privatization programme: that should be consistent with our democratic institutions.
- This is essential as the public-sector stock values are still depressed.
- Reduce public shareholding to 26 % across public-sector banks, steel companies, oil companies, and every manufacturing company and hotels.
- Privatization should be based on public comment, the debate in Parliament, hearing out the stakeholders, and compromise with the interests of state governments.